Top Online Payment Methods in Germany

Top Online Payment Methods in Germany: Key Insights

• PayPal's Dominance: In 2023, PayPal maintained its top spot in Germany, widening the gap with competitors, such as VISA and Mastercard.

• Card Market Fluctuations: The setback faced by Mastercard and VISA indicates a fluctuating market where established card payments are facing challenges from alternative methods like bank transfers and digital wallets.

• Rise of Bank Transfers: Bank transfers and cash in advance increased to 77.3%, becoming a growing competitor to card payments.

Imagine shopping online, everything from your shopping list is in your cart, ready for checkout. When it comes to the payment page, a variety of payment methods are offered, but which one to trust? Is it VISA, Mastercard, or perhaps the eWallet giant PayPal?

Not every discharge process is equally trusted by customers: For instance, in the UK, payments with VISA and Mastercard cards are preferred, while in Czechia, cash on delivery is the most common method. But how about the German eCommerce market, which offered payment method is the most popular in Germany? Let's see how it all adds up

Most Popular Payment Methods in Germany: PayPal Leads the Ranking

Despite losses, card payments maintain their second and third positions, while digital wallets remain a popular choice in the German eCommerce market. However, the growth of bank transfer/cash in advance has the potential to change this landscape and overtake both Mastercard and VISA.

Based on ECDB data, eWallets and cards dominated in 2023 the payment methods offered in the German eCommerce market – let's take a look at the details.

1. PayPal

PayPal has been available in Germany for almost 20 years. Over the years, the payment provider has managed to be the most offered payment method in Germany, with 93.1% of the eCommerce market offering PayPal services.

PayPal is at the same time an eWallet as well as a digital wallet because the app can store funds on the platform, offers person-to-person transfers and more. Among eWallets such as Apple Pay, Google Pay and Amazon Pay, the U.S. payment platform is the oldest and most widely used.

2. VISA

In second place is VISA, offered by 82.1% of the German eCommerce market. After cash, card payments such as VISA are one of the oldest payment methods.

Although the first credit card was invented in 1950, it was not as digital as VISA is today. Today, paying with a card does not always mean a physical card, but can also be a card on your mobile phone.

3. Mastercard

Mastercard and VISA often differ by minimal percentages, including here with a difference of only 0.1%, putting Mastercard in third place. In total, 82% of the German eCommerce market offers the U.S. card service.

But the payment provider does not only offer card payment services. Mastercard has recently invested in a new payment method, the Biometric Checkout Program, which is currently being tested in Poland together with Empik and PayEye.

4. Bank Transfer & Cash in Advance

In fourth place is the payment method bank transfer/cash in advance, which is offered by 77.3% of the eCommerce industry in Germany. This method is primarily associated with a high level of security.

When it comes to high-risk trade relations or export markets, this payment method is particularly suitable. Among other things, it minimizes the risk of non-payment for the seller and excludes the possibility of credit risk.

5. Sofortüberweisung

Finally, in fifth place stands Sofortüberweisung, which in English means instant bank transfer, with 53.3%. This online payment method exists since 2005 and is offered by the company Sofort GmbH.

Sofortüberweisung here means that a seller immediately receives a payment confirmation, not the actual balance. In addition, the service recently merged with the AI-powered global payment network and shopping assistant Klarna.

Popular Payment Methods: Germany in Comparison to the UK

While in the UK, a trend towards digital wallets is noticeable with providers like PayPal and Apple Pay among the top 5, there is no clear trend in Germany. It is evident that the German eCommerce market offers a greater variety of payment systems, including card payments, eWallets, digital wallets, and bank transfers.

Meanwhile, three major players appear in both rankings – PayPal, Mastercard, and VISA – but all three perform differently in the United Kingdom than in Germany, despite the trend towards digital wallets. For more detailed information, check out our latest insight on the most popular payment methods in the United Kingdom.

Sources: ECDB, secondary sources in the referenced articles.